CPA gives SMA 30 days to pay over $1M in fees

The Commonwealth Ports Authority has sent Star Marianas Airline a letter giving the airlines 30 days to pay an overdue balance of over $1 million in airport fees.

Last week, CPA executive director Leo B. Tudela, in a letter addressed to SMA president Shaun Christian, demanded that SMA address its outstanding debt of $1,294,497.16 in airport fees for the airports on Saipan, Tinian, and Rota from Oct. 1, 2022, to May 2024.

Tudela, in his letter, is demanding that Star Marianas make a payment on its delinquent accounts in the next 30 days.

SMA’s outstanding balance for fees at Francisco C. Ada/Saipan International Airport amounts to $573,881.61 according to Tudela.

As for the Francisco Manglona Borja/Tinian International Airport, SMA’s outstanding balance is $286,987.98 and for the Benjamin Taisakan Manglona International Airport on Rota, the airline owes CPA $433,627.57, Tudela detailed in his letter.

Saipan Tribune has reached out to SMA president Christian, but he has yet to issue an official statement on the letter.

According to Saipan Tribune archives, SMA and CPA has long been in dispute over unpaid airport fees dating back to 2014.

Back in January 2022, SMA sent out an informal complaint to the Federal Aviation Administration accusing CPA of unilaterally imposing new rates in October 2021 and that CPA allegedly violated its federal obligation to impose reasonable rates and charges pursuant to FAA policy regarding airport rates and charges.

According to a letter issued by FAA’s Brian Armstrong to SMA president Shaun Christian, the FAA determined that CPA did not violate its grant obligations as it relates to reasonableness of the fees CPA charges.

Specifically, the FAA found that there is no federal regulation requiring any single approach to rate setting other than that the methodology be applied consistently to similarly situated aeronautical users and conforms to the U.S. Department of Transportation’s Policy regarding airport rates and charges.

Additionally, Armstrong said, the policy only states that airline rates and fees may not unjustly discriminate against aeronautical users.

Because of these findings, SMA was instructed to resolve all delinquent accounts with CPA and to pay all its past due fees.

According to data acquired from the CPA, as of Jan. 31, 2023, SMA owes CPA $3,179,150.64 in fees.

In addition, SMA also owes CPA $1,579,953.35 in interest, bringing the overall total balance to $4,759,103.99.

SMA and CPA are also currently in a legal battle dating back to 2022 regarding a breach in SMA and CPA’s airline use agreement that both parties entered into in April 2009 by failing to adjust fees and charges based on CPA’s actual cost of services provided to SMA.